In spite of the daunting challenges which was the bane of the insurance industry in 2017, the sector grew its gross premium income by 15per cent to an estimated N363 billion from N315.96 billion written in 2016.
This was announced at the weekend by Mr. Eddie Efekoha, the immediate past chairman of the Nigerian Insurers Association (NIA) at the association’s 47th Annual General Meeting held in Lagos.
Efekoha noted that though there has been a relative stability in the accessibility of the exchange rate and the inflationary trend at the macro level of the economy there hasn’t impacted positively on the lives of Nigerians.
Over the past years, accessible exchange rates have been stabilized thanks to the introduction of the relatively I&E market which is vastly more immune to speculative pressures than prior systems. Exchange rates have stabilized in the $1/N360 to N367. Trading activities have also experienced resurgence.
“The past year has seen a remarkable drop in coupon rates from 16 percent to 18 percent mid-2017, average coupon yields to 10.43 percent per annum yields in May 2018, bringing the interest rate/inflation differential to 1.05 percent. Put simply, Nigeria’s recent recovery is great on a macroeconomic scale, but barely improves the standard of living of an average Nigerian.
The insurance industry is not insulated from developments in the general economic space, and had its fair share of the challenges facing the larger financial market during the year review”.
He contended that insurance companies had to contend with increasing cost of operations due to epileptic power supply and dilapidated infrastructure such as roads and other public facilities coupled with a suffocating tax regime which in turn impacted the bottom line of insurance companies.
“In spite of these daunting challenges, the insurance industry continues to perform its role of financial intermediation and business restoration in line with its mandate. The volume of business written by the market grew from N315.96billion in 2016 to an estimated N363billion in 2017, representing an expected increase of 15percent over 2016 figure”, the immediate past Governing Council Chairman of NIA noted.
He further disclosed that the industry’s operators in collaboration with the regulator have embarked on various initiatives to deepen insurance penetration, asserting that initiatives such as the insurance industry road map, financial inclusion, micro insurance, bancassurance the insurance industry re-branding project, the association USSD initiative, and other strategic efforts will increase insurance uptake by the public.